Pandemics, Economic Freedom, and Institutional Trade-Offs

23 Pages Posted: 12 Oct 2020

See all articles by Vincent Geloso

Vincent Geloso

George Mason University - Department of Economics

Ilia Murtazashvili

University of Pittsburgh - Graduate School of Public and International Affairs

Date Written: October 10, 2020

Abstract

We argue that institutions are bundles that involve trade-offs in the government’s ability to provide public goods that affect public health. We hypothesize that economic freedom reduces diseases of poverty and may increase diseases of commerce (those associated with free movement of people, such as smallpox or COVID-19). We focus on smallpox and typhoid fever in the late 19th century and early 20th century in order to build on recent works that make arguments similar to ours (Troesken 2015). Our evidence shows that economic freedom reduced typhoid mortality but had no effect on deaths. The implications for COVID-19 are that the tradeoffs with freedom may not be too severe in the short run, and in the longer run, the wealth benefits from economic freedom are likely to be crucial in reducing vulnerability to commerce diseases primarily from their impact on comorbidities (such as diabetes and heart disease), each of which are reduced by wealth. Thus, economic freedom is on balance good for public health, which suggests that this bundle, while involving necessary tradeoffs, might be the best one for dealing with pandemics.

Keywords: COVID, Economic History, Pandemic, Smallpox, Typhoid Fever, Economic Freedom

JEL Classification: N30, H40, I15

Suggested Citation

Geloso, Vincent and Murtazashvili, Ilia, Pandemics, Economic Freedom, and Institutional Trade-Offs (October 10, 2020). Available at SSRN: https://ssrn.com/abstract=3708999 or http://dx.doi.org/10.2139/ssrn.3708999

Vincent Geloso (Contact Author)

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
United States

Ilia Murtazashvili

University of Pittsburgh - Graduate School of Public and International Affairs ( email )

Pittsburgh, PA 15260-0001
United States

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